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Intellectual property, mobile internet technology and national censorship make an incendiary mix for global business and consumerism. This was brought to center stage recently with the escalating disagreement between Google and the Chinese government over privacy rights for online content. The clash of swords has most recently become a truly intergovernmental affair as well with U.S. Secretary of State Hillary Clinton’s policy speech on global internet rights and the just announced cooperation between Google and the National Security Agency in the search for the hackers behind the intrusion into some customers’ personal emails. Once Google felt its property rights had been impinged, its first headline-making reaction was to immediately provide unfiltered search results to its individual Chinese customers, reversing the policy of acquiescence to China’s political and cultural internet censorship by which it had abided since entering the country.

Yet, l’Affaire Google could have even wider implications for a burgeoning technology taking the world by storm: the eReader. These devices have the ability to carry libraries of books and other information inconspicuously across borders, an issue that no government has apparently considered a discrete policy matter to date.

In China’s case, the threat to the censorship regime could be too big for the government to ignore, both in terms of the potential quantity of subversive material and the ease of dispersing it. As one traveler’s first-hand commentary puts it, “You’ll be fine, as long as it’s not a suitcase full of books and then it’d kinda start looking like you’re smuggling in anti-Chinese propaganda.” Well, the eReader is a suitcase full of books that can be loaded onto the internet and sent via email without requiring any access to the Chinese firewall.

The next question for the broader global business community is whether they will face governments that refuse to honor their asserted intellectual property rights if they do not bind themselves to national censorship requirements. Nor can this be viewed as a purely China vs. World conflict. Western countries including Germany, Canada, and France, for instance, qualify free speech rights in relation to some material regarded as derogatory or anti-social. The implications, like the communication capacities of the devices, are likely to grow virally. Will China be manufacturing components for the key weapons in breaking down its own firewall? And would consumers start requesting confiscation refunds as part of their eReader warranties?

Contact Me:

Michael.McDonough@fiateconomics.com
Michael is an economist/strategist who has worked from Wall Street to Hong Kong primarily focusing on the U.S. and emerging markets. He has also written several columns. More

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